Choosing the Right Repossession & Remarketing Partner: What to Look For

For financial institutions managing auto loans, the repossession and remarketing process can significantly impact recovery rates, compliance exposure, and borrower relationships. Choosing the right partner isn’t just about finding someone who can pick up and resell a vehicle, it’s about aligning with a provider that understands your institution’s risk tolerance, regulatory responsibilities, and reputation.

Here are key factors to consider when evaluating a repossession and remarketing partner:

1. Compliance Expertise

Repossession is a highly regulated process, especially when it comes to consumer protections. Your partner should have a proven track record of adhering to federal and state laws (e.g., UCC rules, the Servicemembers Civil Relief Act, and CFPB guidelines). Ask potential vendors:

• • How do they stay up to date on regulatory changes?
  • What training do their agents receive?
  • Can they provide documentation for compliance audits?
    

The CFPB warns that using repossession forwarders introduces legal exposure—miscommunication can lead to wrongful repossessions (CFPB Report, 2024). A suitable partner should have rigorous compliance processes—covering CFPB guidelines, state-specific rules, and proper borrower notifications.

2. National Coverage with Local Knowledge

Whether you serve borrowers in a single state or across the country, a vendor with both national reach and regional expertise is essential. They should understand local towing laws, title requirements, and auction markets to streamline the entire lifecycle—from recovery to resale. Recent data shows 1.49 million vehicles were repossessed in the U.S. in 2023, up from approximately 1.21 million in 2022, according to Cox Automotive (source).

3. Transparent Communication & Real-Time Updates

You need to know what’s happening with your auto collateral. The right partner will offer real-time updates, from assignment to resolution, through an easy-to-use platform or direct integration with your core system. Look for:

• • Clear status tracking and communication
  • Borrower interaction logs
  • Detailed condition and sale reports

Up to 69% of repossessions involve forwarders, highlighting the need for cohesive communication via portals or APIs (CFPB, 2024). Look for partners offering real-time dashboards with repossession statuses, sale outcomes, and fee breakdowns to reduce audit friction.

4. Proven Recovery & Remarketing Performance

A major piece of the puzzle is how effectively your partner can turn repossessed vehicles into returns. Ask for data on:

• • Average days to sell
  • Net proceeds versus book value
  • Reconditioning strategies and partnerships
  • Which channels they use (e.g., auctions, wholesale buyers, online platforms)
    

According to Cox Automotive, an estimated 1.7 million vehicles were repossessed in the U.S.—the highest level in over a decade—highlighting the importance of choosing a partner with both national reach and local insight for consistent asset recovery across markets.

5. Speed of Assignment to Recovery

Repossession completion takes on average, 16 to 23 days, with subprime accounts averaging 23 days (CFPB Report, 2024). Faster turnaround can reduce storage and holding costs and improve sale timing—vital for preserving asset value.

6. Minimizing Consumer Cost & Deficiency Balances

Lenders using third-party forwarders now account for nearly 66% of completed repossessions, up from 31% in 2018. However, repossessions with forwarders often carry higher consumer fees, posing reputational and compliance risks (Lexology, 2024).

According to the CFPB’s January 2025 report, average deficiency balances after repossession rose sharply—from $7,971 in December 2021 to $11,340 in December 2022, marking a roughly 42% increase in just one year. A partner equipped to control costs and ensure fair borrower treatment is more essential than ever.

7. Integration and Operational Fit

Your internal teams are already juggling multiple systems and processes. Make sure the vendor’s workflows and reporting integrate well with your loan servicing platform, collections process, and compliance framework. Ideally, they can offer:

• • API or direct integrations
  • Standardized reporting
  • Flexibility to align with your policies

8. Reputation and References

Don’t underestimate the power of referrals and case studies. What do peer institutions say about their experience? Ask for references from similar-sized credit unions or banks, especially those in your region or with comparable loan volumes.

9. Proven Recovery Improvement Tools

Solutions that use skip-tracing and analytics tools report up to 30% higher recovery rates, demonstrating the power of data-enhanced repossession strategies. Vendor partnerships enhanced with analytics and automation can significantly improve bottom-line results.

Final Takeaway

Why This Matters

Your repossession partner acts as an extension of your brand. Mishandling repossession can erode trust, invite legal risks, and erode asset value. The right partner safeguards borrower relationships, ensures regulatory compliance, and optimizes recoveries.

Ready to Optimize Your Asset Recovery Strategy?

If you’re evaluating or improving your repossession and remarketing approach, we’re happy to share insights, benchmarks, or case studies tailored to your financial institution. Let’s connect.